Kingdom’s farm sector holds huge potential for investors

Updated 19 September 2012

Kingdom’s farm sector holds huge potential for investors

Demand for agricultural products is swelling across Saudi Arabia, driven by a population boom, rising incomes, affluent lifestyles and a strong economy – the largest in the Gulf region.
Recent studies reveal that the Kingdom currently has around 34,997 hectares of organically planted land with sales of organic products expected to achieve 10 percent annual growth, fueled by the increasing awareness among the local community about the advantages and diversity offered by organic farming.
The study predicts organically planted land to form 5 percent of the total planted area in the Kingdom. Furthermore, poultry consumption is expected to grow by 17.2 percent to reach 1.6 million tons in 2016, while milk production could increase by more than 17 percent to 2.1 million tons between 2015 and 2016.
The Saudi government has allocated SR 60 billion to boost the domestic agricultural sector this year and is actively looking at regional and global agricultural products and services and focusing on organic alternative farming to meet the growing nutritional needs of its citizens.
The upcoming Saudi Agriculture 2012 – the 31st International Agriculture, Water and Agro-Industry Show — will unveil some of the latest solutions addressing the rising demand for agricultural products in the Kingdom and throughout the region. Running from Sept. 24 to 27 at the Riyadh International Convention & Exhibition Centre, the trade fair will cover animal health and production, agricultural finance and banking, agricultural products and services, chemicals and fertilizers, cold storage and crop production, and dairy farming products and equipment, among many others.
Confirming their presence in the event are several key regional and international agriculture industry players and leaders who will share business, investment and policy views with high-ranking agriculture officials. The event is accredited by UFI, the Global Association of the Exhibition Industry.
“Saudi Arabia holds huge potential for investors and businesses who want to work in the region’s largest growing agricultural marketplace.
The 2012 national budget shows how the government has taken a serious stance toward addressing the food needs of its people so now is the perfect time to forge and strengthen ties among local agricultural and food players. Saudi Agriculture 2012 is an ideal platform for determining which solutions can drive the Saudi food agenda,” said Khalid Daou, project manager of Saudi Agriculture at Riyadh Exhibitions Company.
Saudi Agriculture 2012 will showcase the latest in animal health and production, agricultural finance and banking, agricultural products and services, chemicals and fertilizers, cold storage and crop production, dairy farming products and equipment, fisheries and fish farming, greenhouses, handling and transport systems, irrigation and landscaping equipment, machinery and spare parts, organic farming, packaging systems and products, pesticides, pumps and pipe systems, seeds and soil nutrition products, spraying machinery, water treatment, water management systems and warehousing.
Running concurrently with Saudi Agriculture 2012 is the Saudi Agro-Food 2012 — the 19th International Trade Show for Food Products,
and the Saudi Food-Pack — The International Exhibition for Food Processing and Packaging, to feature the latest products, technologies and services in areas ranging from frozen and chilled foods, confectionery, chocolates, health and natural foods, to presentation, processing and packaging equipment.


Oil up after drone attack on Saudi field, but OPEC report caps gains

Updated 31 min 54 sec ago

Oil up after drone attack on Saudi field, but OPEC report caps gains

LONDON: Crude oil prices rose on Monday following a weekend attack on a Saudi oil facility by Yemen’s Houthi militia and as traders looked for signs of progress in US-China trade negotiations.
Price gains were, however, capped to some degree by an unusually downbeat OPEC report that stoked concerns about growth in oil demand.
Brent crude, the international benchmark for oil prices, was up 85 cents, or about 1.4%, at $59.49 a barrel at 1225 GMT.
US West Texas Intermediate (WTI) crude futures were up $1.01, or 1.8%, at $55.88 a barrel.
A drone attack by the Iran-backed Houthi militia on an oilfield in eastern Saudi Arabia on Saturday caused a fire at a gas plant, adding to Middle East tensions, but state-run Saudi Aramco said oil production was not affected.
“The oil market seems to be pricing in again a geopolitical risk premium following the weekend drone attacks on Saudi Arabia, but the premium might not sustain if it does not result in any supply disruptions,” said Giovanni Staunovo, oil analyst for UBS.
Iran-related tensions appeared to ease after Gibraltar released an Iranian tanker it seized in July, though Tehran warned the United States against any new attempt to seize the tanker in open seas.
Concerns about a recession also limited crude price gains.
Meanwhile, China’s announcement of key interest rate reforms over the weekend has fueled expectations of an imminent reduction in corporate borrowing costs in the struggling economy, boosting share prices on Monday.
US energy firms this week increased the number of oil rigs operating for the first time in seven weeks despite plans by most producers to cut spending on new drilling this year.
“WTI in recent weeks has performed relatively better than Brent... Pipeline start ups in the United States have been supportive for WTI, while the ongoing trade war has had more of an impact on Brent,” said Warren Patterson, head of commodities strategy at Dutch bank ING.
The Organization of the Petroleum Exporting Countries (OPEC) cut its forecast for global oil demand growth in 2019 by 40,000 barrels per day (bpd) to 1.10 million bpd and indicated the market would be in slight surplus in 2020.
It is rare for OPEC to give a bearish forward view on the market outlook.
“Such a bearish prognosis will heap more pressure on OPEC to take further measures to support the market,” said Stephen Brennock of oil broker PVM.